DGT DOCS
  • 1. INTRODUCTION
    • 1.1 Executive Summary
    • 1.2 Why DGT
    • 1.3 Distributed Ledgers Technology
      • 1.3.1 Decentralization approach
      • 1.3.2 Consensus Mechanism
      • 1.3.3 Transactions
      • 1.3.4 Layered Blockchain Architecture
      • 1.3.5 Tokenomics
      • 1.3.6 Web 3 Paradigm
      • 1.3.7 Common Myths about Blockchain
    • 1.4 The DGT Overview
      • 1.4.1 Platform Approach
      • 1.4.2 DGT Functional Architecture
      • 1.4.3 Technology Roadmap
    • 1.5 How to create a Solution with DGT Networks
    • 1.6 Acknowledgments
  • 2. REAL WORLD APPLICATIONS
    • 2.1 Case-Based Approach
      • 2.1.1 DGT Mission
      • 2.1.2 The Methodology
      • 2.1.3 Case Selection
    • 2.2 Supply Chain and Vertical Integration
      • 2.2.1 Logistics Solution for Spare Parts Delivery
      • 2.2.2 DGT Based Solution for Coffee Chain Products
    • 2.3 Innovative Financial Services
      • 2.3.1 Crowdfunding Platform
      • 2.3.2 Real World Assets Tokenization
      • 2.3.3 Virtual Neobank over DGT Network
      • 2.3.4 DGT based NFT Marketplace
    • 2.4 Decentralized Green Energy Market
      • 2.4.1 Peer To Peer Energy Trading
      • 2.4.2 DGT based Carbon Offset Trading
    • 2.5 B2B2C Ecosystems and Horizontal Integration
      • 2.5.1 KYC and User Scoring
      • 2.5.2 Decentralized Marketing Attribution
      • 2.5.3 Case Decentralized Publishing Platform
      • 2.5.4 Value Ecosystem
    • 2.6 More Cases
  • 3. DGT ARCHITECTURE
    • 3.1 Scalable Architecture Design
      • 3.1.1 High Level Architecture
      • 3.1.2 DGT Approach
      • 3.1.3 Unique contribution
      • 3.1.4 Component Based Architecture
    • 3.2 Performance Metrics
    • 3.3 Network Architecture
      • 3.3.1 Nework Architecture in General
      • 3.3.2 Network Identification
      • 3.3.3 H-Net Architecture
      • 3.3.4 Transport Level
      • 3.3.5 Segments
      • 3.3.6 Static and Dynamic Topologies
      • 3.3.7 Cluster Formation
      • 3.3.8 Node Networking
      • 3.3.9 Permalinks Control Protocol
    • 3.4 Fault-Tolerant Architecture
      • 3.4.1 Introduction to Fault Tolerance
      • 3.4.2 F-BFT: The Hierarchical Consensus Mechanism
      • 3.4.3 Cluster Based Algorithms
      • 3.4.4 Arbitrator Security Scheme
      • 3.4.5 Heartbeat Protocol
      • 3.4.6 Oracles and Notaries
      • 3.4.7 DID & KYC
    • 3.5 Transactions and Performance
      • 3.5.1 Transaction Basics
      • 3.5.2 Transaction Processing
      • 3.5.3 Transaction and block signing
      • 3.5.4 Transaction Families
      • 3.5.5 Transaction Receipts
      • 3.5.6 Smart Transactions
      • 3.5.7 Private Transactions
      • 3.5.8 Multi signature
    • 3.6 Data-Centric Model
      • 3.6.1 Data layer overview
      • 3.6.2 Global State
      • 3.6.3 Genesis Record
      • 3.6.4 Sharding
      • 3.6.5 DAG Synchronization
    • 3.7 Cryptography and Security
      • 3.7.1 Security Architecture Approach
      • 3.7.2 Base Cryptography
      • 3.7.3 Permission Design
      • 3.7.4 Key Management
      • 3.7.5 Encryption and Decryption
      • 3.7.6 Secure Multi Party Computation
      • 3.7.7 Cryptographic Agility
      • DGTTECH_3.8.4 Gateway Nodes
    • 3.8 Interoperability
      • 3.8.1 Interoperability Approach
      • 3.8.2 Relay Chain Pattern
      • 3.8.3 Virtual Machine Compatibility
      • 3.8.4 Gateway Nodes
      • 3.8.5 Token Bridge
    • 3.9 DGT API and Consumer Apps
      • 3.9.1 Presentation Layer
      • 3.9.2 Application Architecture
    • 3.10 Technology Stack
    • REFERENCES
  • 4. TOKENIZATION AND PROCESSING
    • 4.1 Introduction to Tokenization
      • 4.1.1 DGT Universe
      • 4.1.2 Driving Digital Transformation with Tokens
      • 4.1.3 Real-World Tokenization
      • 4.1.4 Key Concepts and Definitions
    • 4.2 Foundations of Tokenization
      • 4.2.1 Definition and Evolution of Tokenization
      • 4.2.2 Tokenization in the Blockchain/DLT Space
      • 4.2.3 The Tokenization Process
      • 4.2.4 Tokenization on the DGT Platform
      • 4.2.5 Regulatory and Legal Aspects of Tokenization
      • 4.2.6 Typical Blockchain-Based Business Models
    • 4.3 The DEC Transaction Family
      • 4.3.1 DEC Transaction Family Overview
      • 4.3.2 DEC Token Features
      • 4.3.3 DEC Token Protocol
      • 4.3.4 DEC Account Design
      • 4.3.5 DEC Transaction Family Flow
      • 4.3.6 DEC Commands
      • 4.3.7 DEC Processing
      • 4.3.8 Payment Gateways
    • 4.4 Understanding Secondary Tokens
      • 4.4.1 The different types of tokens supported by DGT
      • 4.4.2 How secondary tokens are produced
  • 5. EXPLORING TOKENOMICS
    • 5.1 Introduction
      • 5.1.1 What does tokenomics mean?
      • 5.1.2 Goals of Building the Model for DGT Network
      • 5.1.3 Tokens vs Digital Money
      • 5.1.4 The Phenomenon of Cryptocurrency
      • 5.1.5 Basic Principles of Tokenomics
      • 5.1.6 AB2023 Model
    • 5.2 Node & User Growth
      • 5.2.1 Node Ecosystem
      • 5.2.2 User Growth and Retention Modeling
    • 5.3 Transactions
      • 5.3.1 Transaction Amount Components
      • 5.3.2 Shaping the Transaction Profile: A Three-pronged Approach
      • 5.3.3 Calculation of Transaction Number
    • 5.4 Network Performance Simulation
      • 5.4.1 Endogenous Model
      • 5.4.2 Network Entropy
      • 5.4.3 Network Utility
    • 5.5 Token Supply Model
      • 5.5.1 Introduction to Supply and Demand Dynamics
      • 5.5.2 Token distribution
      • 5.5.3 Supply Protocol
      • 5.5.4 Token Balance and Cumulative Supply
    • 5.6 Token Demand Model
      • 5.6.1 Node-Base Demand
      • 5.6.2 Transaction-Based Token Demand
      • 5.6.3 Staking Part Modeling
      • 5.6.4 Total Demand
    • 5.7 Token Price Simulation
      • 5.7.1 Nelson-Siegel-Svensson model
      • 5.7.2 The Price Model
    • 5.8 Decentralization Measurement
      • 5.8.1 Active Node Index
      • 5.8.2 Node Diversity in Hybrid Networks
      • 5.8.3 Token distribution
      • 5.8.4 Integral Calculation of Decentralization Metric
    • 5.9 Aggregated Metrics
      • 5.9.1 Transaction Throughput: Evaluating Network Performance and Scalability
      • 5.9.2 Market Capitalization: A Dimension of Valuation in Cryptocurrency
      • 5.9.3 Total Value Locked (TVL): A Spotlight on Network Engagement and Trust
  • 6. ADMINISTRATOR GUIDE
    • 6.1 Introduction
      • 6.1.1 Administrator Role
      • 6.1.2 Platform sourcing
      • 6.1.3 DGT Virtualization
      • 6.1.4 Using Pre-Built Virtual Machine Images
      • 6.1.5 Server Preparation
      • 6.1.6 OS Setup and initialization
    • 6.2 DGT CORE: Single Node Setup
      • 6.2.1 Launch the First DGT Node
      • 6.2.2 Dashboard setup
      • 6.2.3 Nodes Port Configuration
      • 6.2.4 Single Node Check
    • 6.3 DGT CORE: Setup Private/Public Network
      • 6.3.1 Network launch preparation
      • 6.3.2 A Virtual Cluster
      • 6.3.3 A Physical Network
      • 6.3.4 Attach node to Existing Network
    • 6.4 DGT Dashboard
    • 6.5 DGT CLI and base transaction families
    • 6.6 GARANASKA: Financial Processing
      • 6.6.1 Overview of DGT’s financial subsystem
      • 6.6.2 DEC emission
      • 6.6.3 Consortium account
      • 6.6.4 User accounts
      • 6.6.5 Payments
    • 6.7 Adjust DGT settings
      • 6.7.1 DGT Topology
      • 6.7.2 Manage local settings
    • 6.8 DGT Maintenance
      • 6.8.1 Stopping and Restarting the Platform
      • 6.8.2 Backing up Databases
      • 6.8.3 Network Performance
      • 6.8.4 Log & Monitoring
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  1. 4. TOKENIZATION AND PROCESSING
  2. 4.2 Foundations of Tokenization

4.2.4 Tokenization on the DGT Platform

The DGT platform offers a robust solution for tokenization, allowing the representation of assets through secondary tokenization on top of its native currency, DEC. As with other blockchain networks, DEC represents the value of the DGT network and is distributed among supporting nodes through the minting mechanism. Whether deployed independently or on the DGT MAINNET, consumers can choose between a token-less model based on CORE or the GARANASKA configuration (requiring the AGPL 3.0 license). Tokenization is a core function of the DGT platform, enabling SWAP operations between tokens and utilizing notary nodes to certify the value of assets. The DGT-ETHEREUM BRIDGE facilitates the creation of wrapped tokens on the Ethereum network.

Approach

Description

Advantages

Limitations

Traditional Method (Based on Smart Contracts)

Utilize smart contracts inherited from Sawtooth SETH (EVM, Solidity) and SABRE (WASM)

- Compatibility with Ethereum platforms

- Leveraging existing smart contract ecosystem

- Familiarity for developers experienced with Ethereum's smart contract languages (EVM, Solidity)

- Requires technical expertise and knowledge of smart contract development

- Potential security vulnerabilities if contracts are not properly audited and implemented

Token Fabrics within the DEC Family

Utilize the 'token' group of commands within the DEC family

- Simplified issuance of tokens using predefined configurations

- Reduced complexity, making token implementation more accessible for non-technical businesses

- Limited customization options compared to the traditional method

- May not cover all use cases or specific token requirements

Custom Transaction Family with Token System Features

Create a custom transaction family with token system features

- Greater flexibility and customization options for tokenization

- Ability to tailor the token system to specific use cases and requirements

- Requires significant development efforts to create and maintain a custom transaction family

- May involve a steeper learning curve for developers unfamiliar with the DGT platform

These three approaches offer different trade-offs, allowing users to choose the most suitable method based on their needs, technical expertise, and desired level of customization. The DGT platform provides options that cater to both developers experienced with Ethereum's smart contracts and non-technical businesses seeking a simplified token issuance process.

When implementing tokenization on the DGT platform, it's crucial to address the traditional challenges associated with tokenization. The table below outlines common problems, examples, and the corresponding DGT solutions:

#

Problem

Example

DGT Solution

1

Entry Threshold

Complexity of token implementation for non-technical businesses

Implement tokenization factories based on transaction families, providing a simplified infrastructure and parameter control

2

Security Vulnerabilities

Lack of qualified programmers for smart contract implementation

Implement secure coding practices, conduct thorough code audits, and provide developer education and resources

3

Token Liquidity

Difficulty in verifying the existence of underlying assets

Utilize Notary Nodes for off-chain verification of assets, ensuring transparency and reliability

4

Price Volatility

Reliance on Ethereum's volatile price and high transaction costs

Enable the option to fix the token price in fiat currency, creating a stablecoin-like feature

5

Lack of Interoperability

Challenges in deploying tokens on different platforms

Develop bridges and interoperability solutions to enable token placement on various networks

6

Regulatory Compliance

Adhering to regulatory requirements and legal frameworks

Implement KYC procedures and ensure compliance with regulatory standards

7

Scalability Issues

Difficulty in scaling tokenization processes

Utilize a scalable F-BFT consensus mechanism to enhance network scalability

8

Data Privacy

Ensuring protection and privacy of token holders' data

Implement advanced security tools like Zero-Knowledge Proofs (ZKP) and cryptographic accumulators

9

Lack of Token Standardization

Lack of standardization in tokenization space

DGT will support standard de-facto ERC-X (Ethereum, 2022) and NIST Tokenization Framework (NIST, 2021)

10

Investor Protection

Ensuring investor protection in tokenized assets

DGT will support the Notary mechanism for off-chain certification, incorporating expert reviews and other protective measures

11

Smart Contract Upgradability

Challenges in upgrading and modifying smart contracts

Simplified process through the use of tokenization fabric in transaction families

The DGT approach to tokenization sets it apart from traditional methods. The platform provides simplified tokenization factories, parameter control, and infrastructure for easy implementation. The utilization of Notary Nodes ensures transparency and reliability in asset verification. Furthermore, the DGT-ETHEREUM BRIDGE enables seamless interoperability with the Ethereum network, expanding token placement options. By addressing security vulnerabilities, scalability challenges, and privacy concerns, the DGT platform offers a comprehensive solution for tokenization.

Tokenization Fabric is a unique concept within the DGT platform that enhances the tokenization process by providing a flexible and customizable framework for creating and managing tokens. It extends the traditional notion of smart transactions by allowing separate token parameters and underlying token code.

With Tokenization Fabric, users can define and configure various aspects of their tokens, such as token supply, tokenomics, transaction rules, and additional functionalities. This modular approach empowers token issuers to tailor their tokens to specific use cases, industries, or regulatory requirements. The fabric enables the creation of different types of tokens, including native coins, stablecoins, security tokens, non-fungible tokens (NFTs), and utility tokens. Each token can have its unique characteristics, such as supply limitations, transfer restrictions, royalty mechanisms, or compliance features.

By utilizing the Tokenization Fabric, businesses and organizations can design and deploy tokens with ease, ensuring that they meet their specific requirements. It simplifies the process of token creation, eliminating the need for complex smart contract development and reducing entry barriers for non-technical users. Moreover, the fabric enhances the upgradability of tokens by providing a modular structure. Changes and updates to token parameters or underlying token code can be implemented seamlessly, ensuring that tokens remain adaptable to evolving business needs or regulatory changes.

Previous4.2.3 The Tokenization ProcessNext4.2.5 Regulatory and Legal Aspects of Tokenization

Last updated 1 year ago